The coin is one of 40,000 Spanish Silver Dollars that Governor Lachlan Macquarie bought in 1812 to solve a currency shortage in the fledgling penal colony of New South Wales.
Macquarie enlisted the help of a convicted forger, William Henshall, to cut a hole in the centre of each coin to prevent them leaving the colony.
The resulting 'donut' was then stamped with the words New South Wales, the value Five Shillings and the date 1813 to create Australia's first coin.
The disc removed from the centre became known as the 1813 Colonial Dump, with a value of 15 pence.
Withdrawn from circulation in 1829, most Holey Dollars and Dumps were sold as bullion. Of those that survived the smelter, there are now only some 300 left, of which 200 are in private hands.
This particular Holey Dollar was created from a coin minted in Lima, Peru in 1808. Melbourne dealers Coinworks, who negotiated the sale, say it is the finest specimen of its type.